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Posted on Techdirt - 5 September 2018 @ 10:41am

A Federal Anti-SLAPP Law Would Make CDA 230 More Effective

“The chilling effect upon the exercise of First Amendment rights may derive from the fact of the prosecution, unaffected by the prospects of its success or failure.” Dombrowski v. Pfiser—Justice Brennan

Lawsuits against institutions that transmit speech, such as newspapers and blogs, impose costs that those institutions act to avoid—if necessary, by preemptively censoring any third-party speech that increases their exposure to legal liability. The purpose of Section 230 of the Communications Decency Act is to prevent this collateral chilling effect, specifically on internet users’ speech. CDA 230 enables the dismissal before trial of suits seeking to hold websites of the user-driven content model, such as Twitter and YouTube, liable for the unlawful speech or conduct of their users. This law is based on a policy judgment that, if held liable for all illegal content within millions of online posts, websites would reduce the amount of speech they transmit and, erring on the side of avoiding legal costs, would censor some lawful speech.

But even unsuccessful suits impose costs—after all, defendants who dismiss a suit before trial on CDA 230 grounds still must hire a team of expensive lawyers to secure dismissal. An empirical study in 2012 by Professor David Ardia at the University of North Carolina determined that the average CDA 230 case terminated on a motion to dismiss takes almost a year to reach dismissal. Ardia noted, plausibly, that litigating for this length of time entails substantial defense-side costs. In order to mitigate the collateral chilling effect of these pre-trial costs, defendants in CDA 230 cases need a fee-shifting mechanism that allows them to impose their costs on plaintiffs whose cases have faltered at the motion to dismiss stage. Given likely political obstacles to adding a fee-shifting provision to CDA 230 itself, a good way to supply this mechanism is through federal anti-SLAPP legislation.

Anti-SLAPP Laws

State anti-SLAPP laws serve a similar, but broader purpose than CDA 230: they provide for the expedited dismissal of meritless suits seeking to sanction the exercise of speech—“Strategic Lawsuits Against Public Participation,” or “SLAPPs,” in both an online and an offline context. The object of a such a meritless suit is often to silence someone or to force them to spend money, and not necessarily to obtain a favorable result at trial. A classic example of a SLAPP is a defamation lawsuit filed by a public figure against a newspaper in response to a critical opinion piece.

To invoke the protection of an anti-SLAPP law, a defendant must go through two steps. First, she must show that a suit is in response to activity on the part of the defendant that falls in one or several categories of First Amendment-related activities. Every anti-SLAPP law is worded differently, but many specify that they protect statements on “matters of public interest,” “issues of public concern” or something similar. Second, a defendant must show, in a promptly organized pre-trial proceeding, that the suit is meritless. And unlike CDA 230, most anti-SLAPP statutes impose the defendant’s costs on the plaintiff upon dismissal.

Currently, there is no federal anti-SLAPP law. As a result, there are important gaps in anti-SLAPP protection. For example, an anti-SLAPP defense is not available to defendants faced with meritless suits involving federal law claims. Additionally, plaintiffs can circumvent anti-SLAPP protection through “forum-shopping”—that is, by strategically bringing a suit in a state with a weaker anti-SLAPP law when bringing the suit in a state with a stronger anti-SLAPP law also would be proper. Federal anti-SLAPP legislation can prevent both of these tactics, not only in a CDA 230 context but with respect to frivolous anti-speech litigation generally.

Combining CDA 230 and Anti-SLAPP Protection in State Court

In some state courts, a defendant like YouTube can combine CDA 230’s substantive protection against liability for third-party content with an anti-SLAPP law’s fee-shifting feature. A defendant in such a case argues that a suit targeting the operator of a website for the speech or conduct of its users is meritless in light of the applicability of a CDA 230 defense and thus should be dismissed under the anti-SLAPP law. And under most anti-SLAPP statutes, the plaintiff must then compensate the defendant for her costs.

The combined application of the two defenses has occurred several times in California state courts. In Albert v. Yelp, for instance, a plaintiff-side consumer lawyer sued Yelp for defamation over negative reviews of her firm. Lenore Albert, the proprietor of a small firm in Huntington Beach, California, advertised herself as a “consumer advocate” fighting on behalf of “the people.” An employee of the firm became upset with Albert after she missed a filing deadline in a case brought on behalf of the employee’s friend. This employee organized a campaign among her friends to lower the firm’s Yelp rating by posting reviews characterizing Albert as an incompetent attorney who misses deadlines. Albert brought a defamation suit against the employee, her friends, and, most importantly for the purpose of obtaining a measurable award of damages, against Yelp itself.

Yelp disposed of the suit with an anti-SLAPP motion. In the first step of its anti-SLAPP analysis, the court noted that whether a lawyer presenting herself as a crusader for “the people” was living up to this self-description was a matter of public interest squarely within the purview of anti-SLAPP protection. Second, the court determined that the suit was meritless, as CDA 230 unambiguously protects Yelp from liability for defamation committed by a consumer reviewer. The case was dismissed and, in accordance with California’s anti-SLAPP statute, Yelp recovered its costs.

Closing Loopholes in This Combined Defense Through Federal Anti-SLAPP Legislation

Plaintiffs, however, can avoid this fortified combination of defenses in at least two ways. First, because state anti-SLAPP rules do not apply to federal claims, a plaintiff bringing a harassing lawsuit can bypass a state anti-SLAPP law by pleading a federal claim rather than a similar state law claim. For example, in 2016, Resolute Forest Products, a Canadian logging company, brought a lawsuit against Greenpeace in response to a media campaign accusing the company of unsustainable logging practices. Resolute alleged, among other claims, that Greenpeace violated both state and federal anti-racketeering laws by “creat[ing] and disseminat[ing] false and misleading reports and information…for the unlawful purpose of soliciting fraudulent donations from the public-at-large.” Resolute’s federal racketeering claim was equivalent to its state racketeering claim and overlapped with its state law defamation cause of action, which provides relief for reputational harm from false statements. A California federal court dismissed all claims against Greenpeace but only applied the anti-SLAPP law’s fee-shifting feature to the state law claims. Thus, Resolute partly accomplished its intended objective of forcing Greenpeace to spend money defending itself it court.

Second, a plaintiff can avoid state anti-SLAPP protection by strategically filing a suit in a jurisdiction with a weak anti-SLAPP law. For example, Washington Redskins owner Daniel Snyder responded to an article in a Washington D.C. newspaper criticizing Snyder’s management and ownership practices by threatening to sue a New York hedge fund that owned the paper. Washington, D.C. had at the time and continues to have a stronger anti-SLAPP law than New York. In a letter to the hedge fund, Snyder’s attorney candidly admitted the abusive motivation of the suit, writing “We presume defending such litigation would not be a rational strategy for an investment fund such as yours. Indeed, the cost of litigation would presumably quickly outstrip the value of the Washington City Paper.” Snyder ultimately dropped the suit.

A federal anti-SLAPP law would close these loopholes in anti-SLAPP protection. Federal claims would be subject to federal anti-SLAPP rules. And a federal anti-SLAPP law can contain a removal provision that allows defendants to transfer a suit to federal court, which would prevent forum-shopping. More specifically, federal anti-SLAPP legislation would maximize internet users’ protection from collateral censorship by making the anti-SLAPP fee-shifting mechanism available to defendants in a broader range of CDA 230 cases.

Limitations to Anti-SLAPP Legislation’s Enhancing Effect Upon CDA 230

While federal anti-SLAPP legislation undoubtedly would enhance CDA 230, there are certain gaps in both CDA 230 and anti-SLAPP protection that would not be mitigated by combining the two at the federal level. First, CDA 230 immunity can be narrowed by statutory amendment or judicial interpretation, and any such development simultaneously reduces the scope of anti-SLAPP protection in a CDA 230 context. Second, state anti-SLAPP jurisprudence suggests that a federal anti-SLAPP law would not apply in all CDA 230 cases.

A federal anti-SLAPP law would neither add to nor subtract from substantive CDA 230 immunity, however Congress and the courts independently choose to define this immunity. An anti-SLAPP defense can only be invoked against a meritless suit, and a complaint that pleads around the bounds of CDA § 230 immunity potentially has merit. Any legislation creating exceptions to CDA 230 immunity, such as the recently enacted Allow States and Victims to Fight Online Sex Trafficking Act, would simultaneously limit anti-SLAPP protection. The same is true of any judicial doctrine reducing the scope of CDA 230 immunity. For example, in the wake of Fair Housing Council of San Fernando Valley v. Roommates.com, which established that website operators can be held liable for “materially contributing” to unlawful third-party content, a number of lower courts have permitted plaintiffs to overcome a motion to dismiss with mere allegations that the defendant has played a role in the creation of content. A court would permit a plaintiff to overcome an anti-SLAPP motion on the same basis.

Additionally, courts likely would define limitations to anti-SLAPP protection that would preclude a federal anti-SLAPP defense in some CDA 230 cases. As explained, under anti-SLAPP statutes, before a court determines whether a claim is meritorious, the court typically must make a threshold finding that a legal dispute involves a matter of public interest. Defendants’ anti-SLAPP motions are sometimes defeated because the subject matter of the speech at issue is not “of concern to a substantial number of people,” but rather is something of interest only to the litigants or to a small subset of the public.

Inevitably, courts will find that some claims that lack merit on account of the applicability of a CDA 230 defense nevertheless do not qualify for anti-SLAPP protection because they do not touch on a matter of public concern. For instance, California courts sometimes distinguish online consumer reviews that involve simply an individual customer’s assessment of a vendor—a purportedly private matter—from reviews that provide additional commentary on issues of interest to the public, such as advice on how to choose a vendor within a certain industry. While CDA 230 typically protects a defendant consumer review website from liability for an unlawful consumer review, anti-SLAPP protection at the state level does not apply in all such cases. More generally, there is an imperfect overlap between CDA 230 immunity and anti-SLAPP protection. Assuming that a federal anti-SLAPP statute would mimic the language of broad state anti-SLAPP statutes, a similar imperfect overlap with CDA 230 likely will develop in jurisprudence interpreting a federal anti-SLAPP statute.

Conclusion

Although CDA 230 has come under criticism recently pertaining to some of its specific applications, it is important to sustain CDA 230’s central role in enabling the modern system of internet discourse and commerce. To accomplish more fully its indispensable purpose of protecting internet users from the threat of collateral censorship, this legal linchpin of the modern web needs to be supplemented with a fee-shifting provision. Passing federal anti-SLAPP legislation is an effective means to provide this crucial support.

Julio Sharp-Wasserman is a third-year Columbia law school student and Notes Editor for the Columbia Science and Technology Law Review, which will be publishing his student note on CDA 230 this winter.

Evan Mascagni is the Policy Director for the Public Participation Project, a non-profit organization working to pass federal anti-SLAPP legislation in Congress. PPP also assists individuals and organizations working to pass anti-SLAPP legislation in their states.

Posted on Techdirt - 18 September 2014 @ 03:46am

Federal Legislation Introduced To Strengthen Consumer Free Speech Rights Online

Last week, Tim Cushing wrote about California’s new law that outlaws consumer-silencing non-disparagement clauses. Apparently momentum is on consumers’ side, as Rep. Eric Swalwell, along with Rep. Brad Sherman, introduced similar federal legislation this week to protect all consumers from this shady tactic.

The bill, cited as the “Consumer Review Freedom Act of 2014,” voids any provision of a contract that:

  1. prohibits or restricts the ability of a person who is a party to the form contract to engage in a covered communication;
  2. imposes a penalty or fee against a person who is a party to the form contract for engaging in a covered communication; or
  3. assigns or provides an exclusive license, or requires a person who is a party to the form contract to assign or provide an exclusive license, to any business, other person, or entity any intellectual property rights that such party to the adhesion contract has or may have in a covered communication.

The bill later defines “covered communication” as “a person’s written, verbal, or pictorial review, performance assessment of, or other similar analysis of, the products, services, or conduct of a business which is a party to the form contract.”

While the bill does not specify fines for violations like California’s new law, it is still a step in the right direction (and better than nothing).

In his press release following the introduction, Swalwell said, “No country that values free speech would allow customers to be penalized for writing an honest review. I introduced this legislation to put a stop to this egregious behavior so people can share honest reviews without fear of litigation. I look forward to advancing this in a bipartisan manner, and protecting the right to speak one’s mind.”

Swalwell also cited Palmer v. Kleargear.com in his press release (the case involving a couple from Utah who was fined $3,500 by KlearGear for violation of a non-disparagement clause after they posted a negative review online about their experience with the company).

Palmer is just one example of recent headlines that shed light on the problem of non-disparagement clauses. From a hotel in New York that threatened to charge guests $500 for posting negative reviews online, to a contractor who voided his client’s warranty because of a negative online review, numerous examples over the past few years have shed light on this shameful practice by businesses.

Though this is not an entirely new phenomenon. Consumers have been getting hit with Strategic Lawsuits Against Public Participation (SLAPPs) for years, where a plaintiff files a meritless lawsuit against a consumer for posting a negative review online. Yet, now businesses are attempting to avoid having to file a SLAPP by burying non-disparagement clauses in the fine print of consumer contracts.

Both tactics by businesses are aimed at chilling the First Amendment rights of consumers. Here’s hoping Rep. Swalwell’s bill becomes law and that federal anti-SLAPP legislation follows suit.

Evan Mascagni is the Policy Director of the Public Participation Project (www.anti-slapp.org), a nonprofit organization dedicated to enactment of strong federal and state legislative protections against SLAPPs.

Posted on Techdirt - 29 October 2012 @ 11:41am

The Year In SLAPPs: From The Oatmeal To Pink Slime

2012 has been yet another year filled with meritless lawsuits filed solely to chill First Amendment free speech rights — so-called Strategic Lawsuits Against Public Participation (SLAPP). As websites relying on user-generated content continue to increase in popularity, we also see a rise in SLAPPs targeting online speech, from the everyday blogger to the one-time online reviewer. Some of the most talked about SLAPPs this year include:

The Oatmeal SLAPP — Matthew Inman wrote a blog post condemning FunnyJunk for posting hundreds of his comics without crediting or linking back to his website, The Oatmeal. Through attorney Charles Carreon, FunnyJunk sent Inman a threat letter over the blog post, claiming it was defamatory and demanding $20,000. Inman’s response? To publicly post the letter with a hilarious critique and start an online fundraising campaign to raise $20,000. Yet, instead of reaching his $20,000 goal and sending the money to FunnyJunk, he raised over $200,000 and gave all of the money to charity. Carreon couldn’t let it go and filed a lawsuit to try to derail the fundraising campaign, but later voluntarily dismissed it.

SLAPP 4 Jesus — Even churches are SLAPP happy, as evidenced by a SLAPP filed by Beaverton Grace Bible Church in Oregon against former church members who had blogged and written online reviews of their experiences at the church. The judge ruled that the case was a SLAPP and ordered the church to pay the defendants’ attorneys fees.

Rachel Maddow SLAPPed 4 Jesus — A defamation suit against Rachel Maddow was filed by Bradlee Dean, an anti-LGBT preacher from Minnesota. Dean sued Maddow after she ran a story on The Rachel Maddow Show, where she aired a segment from Dean’s radio show where he said that Muslims were “more moral than even the American Christians” because they were “calling for the execution for homosexuals.” Luckily for Maddow, Washington D.C. enacted a strong anti-SLAPP law last year. The judge ruled that the case was a SLAPP and ordered Dean to pay Maddow’s attorneys fees.

“The Pink Slime” SLAPP — Beef Products, Inc., a South Dakota beef producer, recently filed a defamation lawsuit against ABC News, seeking at least $1.2 billion in damages, claiming the broadcaster unfairly disparaged its beef additive by labeling it “pink slime.” The Complaint was filed last month and ABC has not yet responded.

Fortunately for Inman, the church SLAPP defendants and Rachel Maddow, California, Oregon and Washington DC have all enacted anti-SLAPP statutes. Unfortunately for ABC, Beef Products filed their defamation lawsuit in South Dakota, which does not have an anti-SLAPP law. What this means is that they will not be able to bring an anti-SLAPP motion and potentially get the case dismissed early and have their attorneys’ fees awarded. However, South Dakota is not alone — almost half of the states have not enacted anti-SLAPP laws, demonstrating the need for a federal law to protect against meritless SLAPPs.

2012 marked the second time federal anti-SLAPP legislation was introduced in Washington DC. In 2009, Congressman Steve Cohen introduced the Citizen Participation Act in the House of Representatives, which ultimately died when it was referred to committee. This year, retiring Senator John Kyl introduced the Free Press Act of 2012. Unfortunately, Sen. Kyl’s bill has a very narrow anti-SLAPP provision that only applies to representatives of the news media. But hopefully Senator Kyl’s bill can be a starting point to build bi-partisan support for strong and robust federal anti-SLAPP legislation after the November elections. With a recent endorsement of federal anti-SLAPP legislation from the American Bar Association, a national association of attorneys and the world’s largest voluntary professional organization, a fresh session of Congress in 2013 looks promising for the future of anti-SLAPP legislation protecting all Americans’ right to speak out.

Evan Mascagni is an Organizer with the Public Participation Project, the only organization in the country whose sole mission is to enact federal anti-SLAPP legislation.

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